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Wilmington Savings Fund Society, FSB v. Kattula

United States District Court, E.D. Michigan, Southern Division

July 27, 2018

Wilmington Savings Fund Society, FSB, Plaintiff,
v.
Maria C. Kattula, Robert Kattula, Maria C. Kattula Living Trust Dated 10-23-95, TAJ Graphics Enterprises, LLC, United States of America, and Green Lake Equities, LLC, Defendants.

          Anthony P. Patti, Mag. Judge.

          FINDINGS OF FACT AND CONCLUSIONS OF LAW

          JUDITH E. LEVY, UNITED STATES DISTRICT JUDGE.

         Plaintiff Wilmington Savings Fund, FSB brings this lawsuit seeking (1) declaratory relief in the form of reinstatement of a mortgage that was erroneously discharged, and (2) recovery of amounts due under a promissory note and foreclosure of the mortgage. (Dkt. 1 at 19, 24.) On May 10, 2018, the Court held a bench trial on this matter. The parties submitted post-trial briefs (Dkts. 41, 42, 43), and the Court now issues its decision in favor of defendants.

         I. Background

         This is a dispute about a mortgage on real property situated at 4306 Brightwood Drive, Troy, Michigan 48085. Plaintiff alleges that it is the owner of the note and mortgage on the property, the mortgage is in default, and plaintiff is entitled to foreclose the mortgage in order to collect the balance due. Defendant argues that the loan in question was discharged and satisfied.

         Plaintiff has the burden to demonstrate, by a preponderance of the evidence admitted at trial, that it is entitled to the relief sought.

         II. Evidence Presented at Trial

         At trial, plaintiff called a single witness - Mr. Michael Surowiec, the corporate representative for the plaintiff - to provide testimony. (Dkt. 40 at 4, 26.) Surowiec is the Vice President of Capital Markets at American Mortgage Investment Partners (AMIP). (Id. at 26-27.) AMIP is the administrator for the assets of Wilmington Savings Fund Society, FSB, d/b/a/ Christiana Trust, the named plaintiff in this case. (Id. at 28.)

         Surowiec testified that his specific job duties at AMIP include: running the transaction management for plaintiff's sales, conducting due diligence oversight, and appearing as the corporate witness in non-jury trials. (Id. at 27.) He testified that he is “familiar with all of the assets AIMP has purchased on behalf of [plaintiff]” (Id. at 29) but that he was not involved in the decision to purchase the loan at issue in this case (Id. at 114), he did not perform the due diligence related to the purchase of the loan in this case (Id.), and he does not have a decision role in acquiring loans. (Id. at 115.)

         Plaintiff relied on two types of documentation to support its claims related to the loan - certified copies of documents filed with the Oakland County Register of Deeds, and copies of records contained within AIMP's internal loan file.

         Plaintiff introduced, without objection, the original promissory note for the property at 4306 Brightwood Drive, dated January 26, 2005. (Dkt. 40 at 43.) The note indicates that the borrower - Maria Kattula - promises to pay “U.S. $365, 750.00 (this amount is called “Principal”), plus interest, to the order of . . . Fifth Third Mortgage - MI, LLC.” (Dkt. 41-1 at 1.) The note indicates that at the time it was signed, the yearly interest rate was 6.375%, and that the fixed interest rate “will change to an adjustable interest rate on the first day of February, 2010, and the adjustable interest rate . . . may change on that day every 12th month thereafter.” (Id.)

         Plaintiff further introduced, without objection, a copy of the mortgage, dated January 26, 2005, for the property at 4306 Brightwood Drive. (Dkt. 41-2.) The mortgage indicates that the borrowers were Maria C. Kattula and Robert Kattula as wife and husband. Surowiec testified that the mortgage secured the repayment of the accompanying note. (Dkt. 40 at 48.) Surowiec confirmed that there is nothing on the face of the promissory note or the mortgage related to plaintiff Wilmington Savings Fund. (Id. at 51.)

         To prove the connection between the original mortgage and promissory note and Wilmington Savings Fund, plaintiff introduced a series of five documents each entitled “Assignment of Mortgage.” (Id.) The Court inquired as to whether these documents were inadmissible hearsay. Plaintiff responded that they fell under the business records exception to the Federal Rules of Evidence, contending that they qualified because they were documents contained within the file of records purchased by AMIP in their regular course of business. Defendants argued that the documents could not properly be admitted under the business records exception, but confirmed that they had no objections to their admissibility as copies of the documents on file with the Oakland County Register of Deeds. (Id. at 56.)

         The chronological sequence of documents identifies the following assignments: (1) On August 20, 2010, the mortgage was assigned from Fifth Third Mortgage - MI, LLC to Fifth Third Mortgage Company (Dkt. 41-3 at 10); (2) On September 24, 2010, the mortgage was assigned from Fifth Third Mortgage Company to DLJ Mortgage Capital, Inc. (Id. at 4); (3) On July 1, 2015, the mortgage was assigned from DLJ Mortgage Capital, Inc. to Westvue NPL Trust II (Id. at 5.); (4) On October 14, 2015, the mortgage was assigned from Westvue NPL Trust II to Westvue ...


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